Yahoo Regroups with SAAS, Cloud Computing Focus

Yahoo reshuffles its executives and employees into three groups to help the company better target advertisers while supporting search and cloud computing.

In the wake of somewhat successfully fending off Microsoft's and Carl Icahn's hungry hearts for its meaty Web mail and display advertising businesses, Yahoo June 26 officially reorganized (again) into three new teams under President Susan Decker.

New groups include an audience products division to oversee products and product strategy, led by former platform and infrastructure group manager Ash Patel; a U.S. region group to market and sell Yahoo in the United States, led by Hilary Schneider, who previously headed the global partner solutions group; and an insights strategy team to lord over the use of data and analysis across Yahoo.

The company has not yet named this group's leader but plans to within the next few weeks. I presume they are either A) mulling over internal candidates whose ability to lead is untested or B) shopping for outside help. Anyone want to suggest a C?

I could make a cheap joke here and write that Yahoo reconstituted its corporate organization because it lost so many executives to the ugly Microsoft-Yahoo affair. But I won't.

Even so, I meant it when I wrote Yahoo "somewhat successfully" resisted Microsoft and Icahn because it might be a temporary victory.

The Aug. 1 shareholders meeting date is hurtling toward the embattled company at a dizzying speed and no one seems to know whether the patently disappointed, outraged and abused shareholders plan to treat the board to an old-fashioned Salem witch burning. Did I write that out loud? Oops.

Ah, sweet context. The real bit of interesting news to me in Yahoo's announcement today is its focus on cloud computing.

Wait a minute. This is the big Internet company Yahoo, right? Doesn't it already have a bunch of big old data centers packed with servers and storage to host Internet applications? Yes! So, what is new about this?

I've asked for an interview with Balogh, but he may be busy today so let me take a crack at it.

At the surface, putting cloud, a euphemism for Internet-based computing, in the title of the group underscores the industry shift toward hosting applications and other data-driven infrastructure on the Web and letting a vendor hold it for you.

Yahoo already does this with so many apps, including Yahoo Search and Yahoo Mail. Cloud computing clarifies and exemplifies that. Through its leading search and popular Gmail and Docs apps, Google is perhaps the biggest cloud computing provider thus far.

On the enterprise apps part of the cloud, we have Salesforce.com taking the lead with dozens of others in the long tail. So, why rejigger a group with this cloud focus?

Remember, Yahoo's technology goal is to completely rewire its Web mail and search platforms to be open. This is already happening with third-party application development for SearchMonkey. But the company also wants to break down the barriers between its 266 million e-mail users.

This will take some rearchitecting and the company may have to buy a bunch of new servers and storage arrays to do this. But it also may require a whole new Web platform, one big search and social network to serve Yahoo users.

In closing, I read about these moves and I'm torn between being excited and feeling a certain dread because I'm not sure Yahoo shareholders, through courting Microsoft, Icahn or new board members, will let Yahoo execute its plan.

And that's a shame for this former Internet darling. What do you think?